TopBuild Reports Third Quarter 2021 Results

• 21.3% increase in net sales

• 120 basis point gross margin expansion to 29.6%

• 120 basis point operating margin expansion to 15.8%, 170 basis points on an adjusted basis

• 160 basis point adjusted EBITDA margin expansion to 18.7%

DAYTONA BEACH, Fla., Nov. 02, 2021 (GLOBE NEWSWIRE) -- TopBuild Corp. (NYSE:BLD), a leading installer and specialty distributor of insulation and building material products to the North American construction industry today reported results for the third quarter ended September 30, 2021.

Robert Buck, President and Chief Executive Officer, stated, “We are pleased with our overall results, particularly in this challenging environment characterized by supply chain disruptions and labor shortages across the entire construction industry. These market imbalances have impacted homebuilders’ ability to meet the continuing strong consumer demand, constraining growth for the entire industry.

“Our teams continue to do an excellent job managing inputs costs and pricing as evidenced by our strong EBITDA margin expansion this quarter.

“Looking ahead, we are confident in the overall fundamentals of our three end-markets; residential, commercial, and industrial, and our ability to leverage our size, scale, and operational excellence to continue to drive profitable growth.”

Third Quarter Financial Highlights
(unless otherwise indicated, comparisons are to the quarter ended September 30, 2020)

• Net sales increased 21.3% to $845.8 million, 10.6% on a same branch basis, primarily driven by price and acquisitions.
  
• Gross margin increased 120 basis points to 29.6%.
  
• Operating profit was $133.8 million, compared to operating profit of $101.5 million. On an adjusted basis, operating profit was $137.4 million, compared to $101.7 million, a 35.2% improvement.
  
• Operating margin increased 120 basis points, and on an adjusted basis expanded 170 basis points to 16.3%.
  
• Net income was $95.4 million, or $2.88 per diluted share, compared to $70.0 million, or $2.11 per diluted share. Adjusted income was $97.7 million, or $2.95 per diluted share, compared to $69.6 million, or $2.10 per diluted share.
  
• Adjusted EBITDA was $158.2 million, compared to $119.2 million, a 32.8% increase, and adjusted EBITDA margin improved 160 basis points to 18.7%.
• At September 30, 2021, the Company had cash and cash equivalents of $327.9 million and availability under its revolving credit facility of $381.9 million for total liquidity of $709.8 million.
  

Nine Month Financial Highlights
(unless otherwise indicated, comparisons are to nine months ended September 30, 2020)

• Net sales increased 21.3% to $2,422.8 million.
  
• Gross margin expanded 100 basis points to 28.5%.
  
• Operating profit was $358.0 million, compared to operating profit of $252.0 million. On an adjusted basis, operating profit was $364.5 million, compared to $255.5 million, a 42.7% improvement.
  
• Operating margin was 14.8% a 220-basis point improvement. On an adjusted basis, operating margin improved 220 basis points to 15.0%.
  
• Net income was $245.7 million, or $7.41 per diluted share, compared to $176.3 million, or $5.29 per diluted share. Adjusted income was $256.4 million, or $7.73 per diluted share, compared to $171.2 million, or $5.14 per diluted share.
• Adjusted EBITDA was $423.9 million, compared to $315.3 million, a 34.4% increase. Adjusted EBITDA margin was 17.5%, a 170-basis point improvement.
  

Operating Segment Highlights ($ in 000s)
(comparisons are to the period ended September 30, 2020)

TruTeam	3 Months Ended 9/30/21			9 Months Ended 9/30/21				Service Partners	3 Months Ended 9/30/21				9 Months Ended 9/30/21
Sales		$612,900			$1,751,278			Sales		$276,398			$801,363
Change								Change
Volume		1.9%			5.7%			Volume		-5.2%			7.1%
Price		8.4%			4.9%			Price		16.5%			10.4%
M&A		14.3%			11.5%			M&A		1.9%			1.3%
Total Change		24.5%			22.1%			Total Change		13.2%			18.8%
Operating Margin		17.1%			15.9%			Operating Margin		17.1%			15.6%
Change	20 bps			100 bps				Change		370 bps			350 bps
Adj. Operating Margin		17.2%			16.0%			Adj. Operating Margin		17.1%			15.7%
Change	20 bps			100 bps				Change		370 bps			350 bps

Capital Allocation
Acquisitions

	TTM Revenue at		Month
YTD 2021	Acquisition ($millions)		Acquired	Business Focus
LCR Contractors (I)		$58.0	January	Heavy Commercial/Fireproofing
Ozark Foam (I)		$7.7	March	Residential, primarily spray foam
American Building Systems (I&D)		$144.0	April	Residential (94%) & Distribution (6%)
Creative Conservation (I)		$7.4	April	Residential
RJ Insulation (I)		$4.0	June	Residential, shower doors/mirrors
Valley Gutter Supply (D)		$10.0	August	Fabricator & distributor
California Building Products (I)		$18.0	October	Residential and light commercial
Distribution International (D)		$747.0	October	Fabricator and specialty distributor
Total		$996.1

I = Installation
D = Distribution

Buck added, “Acquisitions continue to be our number one capital allocation priority and our acquisition of Distribution International has further enhanced our robust M&A pipeline focused on three end-markets: residential, commercial, and industrial. Over the past six years, we have put together a disciplined team to source and integrate deals, and during this timeframe have put almost $2 billion of capital to work for our shareholders.”

Share repurchases
In the third quarter of 2021, the Company repurchased 60,105 shares at an average price of $191.64 per share.  Year-to-date the Company has repurchased 183,136 shares as an average price of $194.15 per share.

2021 Outlook

Sales and Adjusted EBITDA Guidance ^(*)
($ in millions)

2021	Low			High
Legacy BLD Sales	$	3,255	$	3,295
DI Sales	$	170	$	180
Total Sales	$	3,425	$	3,475
2021	Low			High
Legacy BLD Adj. EBITDA*	$	570	$	585
DI Adj. EBITDA	$	15	$	20
Total Adj. EBITDA	$	585	$	605

*See table for adjusted EBITDA reconciliation.

Additional Information
Quarterly supplemental materials, including a presentation that will be referenced on today’s conference call, are available on the Company’s website at www.topbuild.com.

Conference Call
A conference call to discuss third quarter 2021 financial results is scheduled for today, Tuesday, November 2, at 9:00 a.m. Eastern Time. The call may be accessed by dialing (877) 407-9037. The conference call will be webcast simultaneously on the Company’s website at www.topbuild.com.

About TopBuild
TopBuild Corp., headquartered in Daytona Beach, Florida, is a leading installer and specialty distributor of insulation and building material products to the North American construction industry. We provide insulation solutions and building material installation services through TruTeam which has approximately 235 branches. We distribute building insulation and building product materials for the residential and commercial end-markets through Service Partners and mechanical insulation and other specialty products for the commercial and industrial end-markets through Distribution International. Our specialty distribution network encompasses 175 branches. To learn more about TopBuild please visit our website at www.topbuild.com.

Use of Non-GAAP Financial Measures
Adjusted EBITDA, incremental EBITDA margin, adjusted EBITDA margin, the “adjusted” financial measures presented above, and figures presented on a “same branch basis” are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company believes that these non-GAAP financial measures, which are used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. We define same branch sales as sales from branches in operation for at least 12 full calendar months. Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP. Additional information may be found in the Company’s filings with the Securities and Exchange Commission which are available on TopBuild’s website at www.topbuild.com.

Safe Harbor Statement
Statements contained herein reflect our views about future periods, including our future plans and performance, constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995.  Forward-looking statements can be identified by words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” or “intend,” the negative of these terms, and similar references to future periods.  These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements.  We caution you against unduly relying on any of these forward-looking statements.  Our future performance may be affected by the duration and impact of the COVID-19 pandemic on the United States economy, specifically with respect to residential and commercial construction; our ability to continue operations in markets affected by the COVID-19 pandemic and our ability to collect receivables from our customers; our reliance on residential new construction, residential repair/remodel, and commercial construction; our reliance on third-party suppliers and manufacturers; our ability to attract, develop, and retain talented personnel and our sales and labor force; our ability to maintain consistent practices across our locations; and our ability to maintain our competitive position.  We discuss the material risks we face under the caption entitled “Risk Factors” in our Annual Report for the year ended December 31, 2020, as filed with the SEC in February 2021, as well as under the caption entitled “Risk Factors” in subsequent reports that we file with the SEC.  Our forward-looking statements in this filing speak only as of the date of this filing.  Factors or events that could cause our actual results to differ may emerge from time to time and it is not possible for us to predict all of them.  Unless required by law, we undertake no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise.  The Company believes that the non-GAAP performance measures and ratios that are contained herein, which management uses to manage our business, provide users of this financial information with additional meaningful comparisons between current results and results in our prior periods. Non-GAAP performance measures and ratios should be viewed in addition, and not as an alternative, to the Company's reported results under accounting principles generally accepted in the United States. Additional information about the Company is contained in the Company's filings with the SEC and is available on TopBuild's website at www.topbuild.com.

Investor Relations and Media Contact
Tabitha Zane
tabitha.zane@topbuild.com

TopBuild Corp.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except share and per common share amounts)
		Three Months Ended September 30,								Nine Months Ended September 30,
		2021				2020				2021				2020
Net sales		$	845,757			$	697,223			$	2,422,810			$	1,996,551
Cost of sales			595,466				498,895				1,731,581				1,448,210
Gross profit			250,291				198,328				691,229				548,341
Selling, general, and administrative expense			116,485				96,805				333,252				296,372
Operating profit			133,806				101,523				357,977				251,969
Other income (expense), net:
Interest expense			(5,503	)			(7,692	)			(18,210	)			(24,711	)
Loss on extinguishment of debt			—				—				(13,862	)			(233	)
Other, net			66				86				210				648
Other expense, net			(5,437	)			(7,606	)			(31,862	)			(24,296	)
Income before income taxes			128,369				93,917				326,115				227,673
Income tax expense			(32,934	)			(23,921	)			(80,457	)			(51,407	)
Net income		$	95,435			$	69,996			$	245,658			$	176,266
Net income per common share:
Basic		$	2.91			$	2.13			$	7.49			$	5.35
Diluted		$	2.88			$	2.11			$	7.41			$	5.29
Weighted average shares outstanding:
Basic			32,763,311				32,847,652				32,818,145				33,960,969
Diluted			33,088,680				33,210,545				33,155,995				33,337,259

TopBuild Corp.
Condensed Consolidated Balance Sheets and Other Financial Data (Unaudited)
(dollars in thousands)
		As of
		September 30,				December 31,
ASSETS		2021				2020
Current assets:
Cash and cash equivalents		$	327,906			$	330,007
Receivables, net of an allowance for credit losses of $8,856 at September 30, 2021, and $6,926 at December 31, 2020			516,941				427,340
Inventories, net			202,018				161,369
Prepaid expenses and other current assets			21,240				17,689
Total current assets			1,068,105				936,405
Right of use assets			104,047				83,490
Property and equipment, net			203,530				180,053
Goodwill			1,496,737				1,410,685
Other intangible assets, net			234,872				190,605
Deferred tax assets, net			2,751				2,728
Other assets			10,646				11,317
Total assets		$	3,120,688			$	2,815,283
LIABILITIES
Current liabilities:
Accounts payable		$	382,932			$	331,710
Current portion of long-term debt			23,557				23,326
Accrued liabilities			141,261				107,949
Short-term lease liabilities			37,048				33,492
Total current liabilities			584,798				496,477
Long-term debt			675,567				683,396
Deferred tax liabilities, net			166,240				168,568
Long-term portion of insurance reserves			47,775				50,657
Long-term lease liabilities			71,290				53,749
Other liabilities			13,307				13,642
Total liabilities			1,558,977				1,466,489
EQUITY			1,561,711				1,348,794
Total liabilities and equity		$	3,120,688			$	2,815,283
		As of September 30,
		2021				2020
Other Financial Data
Receivable days			45				48
Inventory days			33				27
Accounts payable days			75				81
Receivables, net plus inventories, net less accounts payable		$	336,027			$	267,369
Receivables, net plus inventories, net less accounts payable as a percent of sales (TTM) †			10.3	%			10.1	%
† Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches

TopBuild Corp.
Condensed Consolidated Statement of Cash Flows (Unaudited)
(in thousands)
		Nine Months Ended September 30,
		2021				2020
Cash Flows Provided by (Used in) Operating Activities:
Net income		$	245,658			$	176,266
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			51,005				47,527
Share-based compensation			8,375				12,159
Loss on extinguishment of debt			13,862				233
Loss on sale or abandonment of property and equipment			1,410				290
Amortization of debt issuance costs			1,352				1,103
Provision for bad debt expense			5,215				5,625
Loss from inventory obsolescence			1,667				1,908
Deferred income taxes, net			(1,661	)			(709	)
Change in certain assets and liabilities
Receivables, net			(62,257	)			(13,645	)
Inventories, net			(30,115	)			4,759
Prepaid expenses and other current assets			(2,984	)			(14,989	)
Accounts payable			47,907				2,152
Accrued liabilities			30,397				33,436
Payment of contingent consideration			(22	)			(413	)
Other, net			(304	)			21
Net cash provided by operating activities			309,505				255,723
Cash Flows Provided by (Used in) Investing Activities:
Purchases of property and equipment			(42,320	)			(27,206	)
Acquisition of businesses			(205,028	)			(21,450	)
Proceeds from sale of property and equipment			298				2,332
Net cash used in investing activities			(247,050	)			(46,324	)
Cash Flows Provided by (Used in) Financing Activities:
Proceeds from issuance of long-term debt			411,250				300,000
Repayment of long-term debt			(427,563	)			(319,168	)
Payment of debt issuance costs			(6,500	)			(2,280	)
Taxes withheld and paid on employees' equity awards			(11,511	)			(14,781	)
Exercise of stock options			5,952				1,438
Repurchase of shares of common stock			(35,556	)			(43,149	)
Payment of contingent consideration			(628	)			(928	)
Net cash used in financing activities			(64,556	)			(78,868	)
Cash and Cash Equivalents
(Decrease) increase for the period			(2,101	)			130,531
Beginning of period			330,007				184,807
End of period		$	327,906			$	315,338
Supplemental disclosure of noncash activities:
Leased assets obtained in exchange for new operating lease liabilities		$	51,190			$	27,098
Accruals for property and equipment			580				278

TopBuild Corp.
Segment Data (Unaudited)
(dollars in thousands)
		Three Months Ended September 30,													Nine Months Ended September 30,
		2021				2020				Change					2021				2020					Change
TruTeam
Sales		$	612,900			$	492,206				24.5	%			$	1,751,278			$	1,434,648				22.1	%
Operating profit, as reported		$	105,046			$	83,142									277,748			$	213,136
Operating margin, as reported			17.1	%			16.9	%								15.9	%			14.9	%
Rationalization charges			—				9									—				866
Acquisition related costs			171				—									1,283				4
COVID-19 pay			—				278									605				916
Operating profit, as adjusted		$	105,217			$	83,429								$	279,636			$	214,922
Operating margin, as adjusted			17.2	%			17.0	%								16.0	%			15.0	%
Service Partners
Sales		$	276,398			$	244,113				13.2	%			$	801,363			$	674,672				18.8	%
Operating profit, as reported		$	47,162			$	32,787									125,403			$	81,612
Operating margin, as reported			17.1	%			13.4	%								15.6	%			12.1	%
Rationalization charges			—				(161	)								—				783
COVID-19 pay			—				15									54				70
Operating profit, as adjusted		$	47,162			$	32,641								$	125,457			$	82,464
Operating margin, as adjusted			17.1	%			13.4	%								15.7	%			12.2	%
Total
Sales before eliminations		$	889,298			$	736,319								$	2,552,641			$	2,109,320
Intercompany eliminations			(43,541	)			(39,096	)								(129,831	)			(112,769	)
Net sales after eliminations		$	845,757			$	697,223				21.3	%			$	2,422,810			$	1,996,551				21.3	%
Operating profit, as reported - segments		$	152,208			$	115,929								$	403,151			$	294,748
General corporate expense, net			(10,812	)			(8,032	)								(24,124	)			(24,610	)
Intercompany eliminations			(7,590	)			(6,374	)								(21,050	)			(18,169	)
Operating profit, as reported		$	133,806			$	101,523								$	357,977			$	251,969
Operating margin, as reported			15.8	%			14.6	%								14.8	%			12.6	%
Rationalization charges			—				(274	)								16				2,102
Acquisition related costs †			3,634				142									5,844				338
Refinancing costs			—				—									—				57
COVID-19 pay			—				293									659				984
Operating profit, as adjusted		$	137,440			$	101,684								$	364,496			$	255,450
Operating margin, as adjusted			16.3	%			14.6	%								15.0	%			12.8	%
Share-based compensation			2,998				3,280									8,375				12,317
Depreciation and amortization			17,784				14,216									51,005				47,527
EBITDA, as adjusted		$	158,222			$	119,180								$	423,876			$	315,294
EBITDA margin, as adjusted			18.7	%			17.1	%								17.5	%			15.8	%
Sales change period over period			148,534													426,259
EBITDA, as adjusted, change period over period			39,042													108,582
Incremental EBITDA, as adjusted, as a percentage of change in sales			26.3	%												25.5	%
† Acquisition related costs include corporate level adjustments as well as segment operating adjustments.

TopBuild Corp.
Non-GAAP Reconciliations (Unaudited)
(in thousands, except share and per common share amounts)
		Three Months Ended September 30,								Nine Months Ended September 30,
		2021				2020				2021				2020
Gross Profit and Operating Profit Reconciliations
Net sales		$	845,757			$	697,223			$	2,422,810			$	1,996,551
Gross profit, as reported		$	250,291			$	198,328			$	691,229			$	548,341
Rationalization charges			—				(63	)			—				1,016
COVID-19 pay			—				273				592				755
Gross profit, as adjusted		$	250,291			$	198,538			$	691,821			$	550,111
Gross margin, as reported			29.6	%			28.4	%			28.5	%			27.5	%
Gross margin, as adjusted			29.6	%			28.5	%			28.6	%			27.6	%
Operating profit, as reported		$	133,806			$	101,523			$	357,977			$	251,969
Rationalization charges			—				(274	)			16				2,102
Acquisition related costs			3,634				142				5,844				338
Refinancing costs			—				—				—				57
COVID-19 pay			—				293				659				984
Operating profit, as adjusted		$	137,440			$	101,684			$	364,496			$	255,450
Operating margin, as reported			15.8	%			14.6	%			14.8	%			12.6	%
Operating margin, as adjusted			16.3	%			14.6	%			15.0	%			12.8	%
Income Per Common Share Reconciliation
Income before income taxes, as reported		$	128,369			$	93,917			$	326,115			$	227,673
Rationalization charges			—				(274	)			16				2,102
Acquisition related costs			3,634				142				5,844				338
Refinancing costs and loss on extinguishment of debt			—				—				13,862				290
COVID-19 pay			—				293				659				984
Income before income taxes, as adjusted			132,003				94,078				346,496				231,387
Tax rate at 26.0%			(34,321	)			(24,460	)			(90,089	)			(60,161	)
Income, as adjusted		$	97,682			$	69,618			$	256,407			$	171,226
Income per common share, as adjusted		$	2.95			$	2.10			$	7.73			$	5.14
Weighted average diluted common shares outstanding			33,088,680				33,210,545				33,155,995				33,337,259

TopBuild Corp.
Same Branch and Acquisition Net Sales and Adjusted EBITDA (Unaudited)
(dollars in thousands)
		Three Months Ended September 30,								Nine Months Ended September 30,
		2021				2020				2021				2020
Net sales
Same branch:
TruTeam		$	542,679			$	492,206			$	1,586,336			$	1,434,648
Service Partners			271,760				244,113				792,834				674,672
Eliminations			(43,206	)			(39,096	)			(128,511	)			(112,769	)
Total same branch			771,233				697,223				2,250,659				1,996,551
Acquisitions (a):
TruTeam		$	70,221			$	—			$	164,942			$	—
Service Partners			4,638				—				8,529				—
Eliminations			(335	)			—				(1,320	)			—
Total acquisitions			74,524				—				172,151				—
Total		$	845,757			$	697,223			$	2,422,810			$	1,996,551
EBITDA, as adjusted
Same branch		$	146,774			$	119,180			$	400,328			$	315,294
Acquisitions (a)			11,448				—				23,548				—
Total		$	158,222			$	119,180			$	423,876			$	315,294
EBITDA, as adjusted, as a percentage of sales
Same branch (b)			19.0	%							17.8	%
Acquisitions (c)			15.4	%							13.7	%
Total (d)			18.7	%			17.1	%			17.5	%			15.8	%
As Adjusted Incremental EBITDA, as a percentage of change in sales
Same branch (e)			37.3	%							33.5	%
Acquisitions (c)			15.4	%							13.7	%
Total (f)			26.3	%							25.5	%
(a) Represents current year impact of acquisitions in their first twelve months
(b) Same branch EBITDA, as adjusted, as a percentage of same branch sales
(c) Acquired EBITDA, as adjusted, as a percentage of acquired sales
(d) Total EBITDA, as adjusted, as a percentage of total sales
(e) Change in same branch EBITDA, as adjusted, as a percentage of change in same branch sales
(f) Change in total EBITDA, as adjusted, as a percentage of change in total sales

TopBuild Corp.
Same Branch and Acquisition Net Sales by Market (Unaudited)
(in thousands)
	Three Months Ended September 30,								Nine Months Ended September 30,
	2021				2020				2021				2020
Same branch:
Residential	$	610,377			$	545,688			$	1,761,630			$	1,557,954
Commercial		160,856				151,535				489,029				438,597
Same branch net sales		771,233				697,223				2,250,659				1,996,551
Acquisitions (a):
Residential	$	62,050			$	—			$	140,190			$	—
Commercial		12,474				—				31,961				—
Acquisitions net sales		74,524				—				172,151				—
Total net sales	$	845,757			$	697,223			$	2,422,810			$	1,996,551
(a) Represents current year impact of acquisitions in their first twelve months

TopBuild Corp.
Reconciliation of Adjusted EBITDA to Net Income (Unaudited)
(in thousands)
		Three Months Ended September 30,									Nine Months Ended September 30,									Trailing Twelve Months Ended
		2021				2020					2021				2020					September 30, 2021
Net income, as reported		$	95,435			$	69,996				$	245,658			$	176,266			$	316,415
Adjustments to arrive at EBITDA, as adjusted:
Interest expense and other, net			5,437				7,606					18,000				24,063				25,660
Income tax expense			32,934				23,921					80,457				51,407				105,117
Depreciation and amortization			17,784				14,216					51,005				47,527				65,888
Share-based compensation			2,998				3,280					8,375				12,317				10,968
Rationalization charges			—				(274	)				16				2,102				12
Acquisition related costs			3,634				142					5,844				338				6,362
Refinancing costs and loss on extinguishment of debt			—				—					13,862				290				13,862
COVID-19 pay			—				293					659				984				1,043
EBITDA, as adjusted		$	158,222			$	119,180				$	423,876			$	315,294			$	545,327
Proforma acquisition EBITDA (a)																				105,148
Proforma combined EBITDA, as adjusted																			$	650,475
Net Debt Calculation
Long-term debt, gross																			$	711,694
Acquisition debt (b)																				807,500
Total long-term debt, gross																			$	1,519,194
Cash and cash equivalents																			$	327,906
Acquisition cash, net (c)																				(243,746	)
Total cash and cash equivalents																			$	84,160
Net debt, total																			$	1,435,034
(a) Represents the trailing twelve months proforma impact of acquisitions completed through the date of this release.
(b) Represents the trailing twelve months proforma impact of debt incurred to fund the acquisition of Distribution International.
(c) Represents the trailing twelve months proforma impact of cash used to fund the acquisition of Distribution International.

TopBuild Corp.
Acquisition Adjusted Net Sales (Unaudited)
(in thousands)
	2020				2021													Trailing Twelve Months Ended
	Q4				Q1				Q2				Q3				September 30, 2021
Net Sales	$	721,487			$	742,798			$	834,255			$	845,757			$	3,144,297
Acquisitions proforma adjustment †		57,830				46,727				4,731				1,336				110,624
Net sales, acquisition adjusted	$	779,317			$	789,525			$	838,986			$	847,093			$	3,254,921
† Trailing 12 months sales have been adjusted for the pro forma effect of acquired branches

TopBuild Corp.
2021 Estimated Adjusted EBITDA Range (Unaudited)
(in millions)
	Twelve Months Ending December 31, 2021
		Low				High
Estimated net income	$	273.0			$	308.7
Adjustments to arrive at estimated EBITDA, as adjusted:
Interest expense and other, net		29.8				27.8
Income tax expense		95.8				108.4
Depreciation and amortization		80.6				78.5
Share-based compensation		11.8				10.8
Rationalization charges		0.9				0.7
Acquisition related costs		18.2				16.2
Refinancing costs and loss on extinguishment of debt		14.9				13.9
Acquisition purchase accounting, including inventory step-up		60.0				40.0
Estimated EBITDA, as adjusted	$	585.0			$	605.0